Celebrity Social Media Influencers: New guidance from the CMA

January 29, 2019

The Competition and Markets Authority (CMA) has announced that it has secured formal commitments from sixteen celebrity influencers. The influencers have promised to say on social media posts if they have been paid or received any gifts or loans of products which they endorse.

Online endorsements from celebrities and influencers can help boost sales. However, both the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (CAP Code) and the Consumer Protection from Unfair Trading Regulations 2008 SI 2008/1277 require them to disclose if they are being paid or provided with incentives to endorse a brand. Otherwise they risk giving a misleading impression that a post represents their personal view about a product or service.

The CMA has also sent a number of warning letters to other celebrities asking them to review their practices where concerns have been identified. Further investigation work will look at the role and responsibilities of social media platforms.

In September 2018 the CMA jointly published guidance with CAP on influencer marketing. It has now issued further guidance saying that influencers must:

  • say when they have been paid, given or loaned items
  • be clear about the relationship with the brand or business: for example, including discount codes, competitions or giveaways is not sufficient. Celebrities should be transparent and state that the post is a promotion. Significantly, the CMA also said that past relationships matter too – anything in the past year should be disclosed as it is likely to be relevant to followers
  • do not mislead – do not give the impression that you are a consumer if you are not; that you have bought something that was given to you as a gift or a loan or that you have used the product itself if you have not

The guidance also states that you need to be honest about what you are promoting and any disclosure should be upfront.

How to disclose a relationship is a matter of concern for influencers and brands and the CMA gives examples of acceptable and unacceptable practices in its guidance. It says that it is not likely that there will be just ‘one way’ of explaining your relationship to a brand. The CMA takes the view that ‘Advertisement Feature’ or ‘Advertisement Promotion’, are useful descriptions, but it has seen a range of other wording, (including #Ad, #Advert, and using the ‘Paid Partnership’ tool on Instagram in addition to these hashtags), which convey the appropriate messages simply and effectively.

The CMA considers that the following practices do not go far enough to comply with the legal requirements:

  • tagging a brand or business in either the text, picture and/or video of a post without additional disclosure
  • tagging a gift from a brand in in either the text, picture and/or video of a post without additional disclosure
  • using discount codes in a post without additional disclosure
  • using ambiguous language without additional disclosure in a post (for example ‘thank you’; ‘made possible by’; ‘in collaboration with’; or ‘thanks to…’)
  • unclear use of hashtags, for example:

– using #sp; #spon; #client; #collab; etc.

– adding #ad directly after the name of the brand or business (for example #[BRANDNAME]ad)

– when the disclosure (for example #ad, #advert) is not prominent because it is hidden at the end of or among other text and/or hashtags

– product placement where there is an associated (and undisclosed) payment or other incentive

– disclosing the commercial affiliation only on an influencer’s front, home or profile page

The CMA says that you do not need multiple statements in each post where there is both a past and current relationship with the same brand or business. Usually, just stating the current relationship is the most appropriate. However, if you have relationships with several brands or businesses featured in the same post, make sure you state all of these prominently and clearly.

Further, the CMA makes the point that each social media platform has different features and is used in different ways so it is important that influencers agencies and brands keep the differences in mind and how they affect what a follower sees or understands from the post.